Friday's remarkable jobs report is great news for the stock market, Jim Cramer told his Mad Money viewers. That's because the markets can take a much-needed break from the trade war and focus on quarterly earnings reports -- which haven't disappointed.
Cramer's game plan for next week begins on Monday with the American Society of Hematology conference. He said Bristol-Myers Squibb (BMY) - Get Report will be presenting and should have good things to say. Also on Monday, we'll get earnings from Chewy (CHWY) - Get Report, MongoDB (MDB) - Get Report and StitchFix (SFIX) - Get Report Monday, but Cramer cautioned the markets are frowning on high-growth companies right now.
Next, on Tuesday, we'll hear from AutoZone (AZO) - Get Report, a stock which Cramer said should be bought ahead of the quarter. Cramer also had kind words to say about Mark Butler, the CEO of Ollie's Bargain Outlet (OLLI) - Get Report, which also reports Tuesday. Butler died earlier this week at the age of 61 and Cramer said he knew Butler to be both a terrific CEO and a man dedicated to supporting charitable causes.
Wednesday brings earnings from Lululemon Athletica (LULU) - Get Report, which should be terrific, but all eyes will be on the Federal Reserve to learn what's next for interest rates given Friday's strong employment numbers.
Then on Thursday, we get earnings from Costco (COST) - Get Report, Broadcom (AVGO) - Get Report, Oracle (ORCL) - Get Report and Adobe Systems (ADBE) - Get Report. Cramer told viewers to pay attention to the member growth at Costco and be a buyer of Broadcom and Adobe.
Cramer and the AAP team are looking at everything from earnings and tariffs to the Federal Reserve. Find out what they're telling their investment club members and get in on the conversation with a free trial subscription to Action Alerts Plus.
Executive Decision: Boot Barn
Conway said Boot Barn's market was an opportunity hiding in plain sight. Boots and cowboy hats may not be popular in New York or Los Angeles, he said, but throughout the middle of the country, their apparel is both functional and fashionable.
When asked about their growth, Conway said that they've seen strong growth in their exclusive brands, which have helped to offset the effects of tariffs for their non-exclusive brands. Boot Barn has been pushing suppliers to help offset rising costs as well as raising pricing where necessary.
Boot Barn currently has over 250 locations, but Conway said they are still expanding and have laid out a plan to double their store count in the coming years.
Executive Decision: Grocery Outlet
Lindberg explained that Grocery Outlet is a sourcing story. The company buys items in bulk from manufacturers and then offers those products in their stores for 40% to 70% off. Customers like discovering new items and love the savings. Grocery Outlet leaves a lot of the decision making to their local operators, as they know best how to serve their local markets.
Lindberg called Grocery Outlet one of the last great American dreams, as its locations are incredible opportunities for the 350 families that own them and they split their profits 50/50 with their operators.
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Executive Decision: Natera
Chapman said Natera is changing the way disease is detected using small amounts of DNA. He said the first application of the technology was prenatal testing, which is now a $300 million business. The company is now expanding their research to include oncology and organ rejection.
There are currently one million tests a year for colorectal cancer that Natera could tap into, Chapman explained. While 150,000 patients have symptoms of the disease, another one million patients are in remission. Natera is working to detect the recurrence of cancer up to eight months before it can be detected via traditional imaging. Early detection of recurring cancer would save lives, he added.
As for organ transplants, Chapman said there are 200,000 patients living with kidney transplants, but up to half of them will reject their organ in the first 10 years. Natera is again studying early detection of these events to help save lives.
Strength to Fight the Trade War?
What are the two big takeaways from Friday's strong jobs report? Everything you learned in economics class is wrong and the trade war isn't what you thought.
Cramer told viewers that for decades when jobs growth was strong, inflation followed. You simply couldn't have one without the other. This notion was so strong that the Federal Reserve used this playbook in 2018, raising interest rates too far, too fast, and slamming the stock market as a result.
But the Fed soon realized that the connection between jobs and inflation is no longer true. They are now making smarter policy decisions and as a result, we have full employment with no signs of inflation.
But what about that trade war? The economists always told us that tariffs would sink our economy, but they clearly aren't. Cramer said at this point, President Trump should simply walk away from trade negotiations, because the tariffs are hurting China way more than they are the U.S. We can weather the storm, they cannot.
Here's what Jim Cramer had to say about some of the stocks that callers offered up during the "Mad Money Lightning Round" Friday evening:
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At the time of publication, Cramer's Action Alerts PLUS had a position in BMY, AMZN.